WHILE in many other countries the gaming industry is undergoing significant change mainly to gambling over the internet, in SA online gambling is still prohibited.

In Europe, analysts are spotlighting the investment potential of online gambling. Advocates of web-based gaming believe that legalisation for internet gambling is the key to growing gambling markets effectively. They argue that while it is difficult to police internet gambling, licensed internet gambling options are preferable to prohibition.

In SA, despite moves by Parliament to approve a new internet gambling law with the National Gambling Act of 2008 to regulate the industry, the proposed regulations, which were published in the Government Gazette for public comment in February 2009, remain subject of debate.

At present, Parliament’s trade and industry committee is holding public hearings on gambling activities. Trade and industry minister Rob Davies believes the government needs to review gambling policy.

Most local gaming operators are keen to get involved in online gaming. They acknowledge its promise in a market that is showing signs of maturing.

A study by Professor André Ligthelm, of the University of South Africa’s bureau of market research, shows that the frequency of casino gambling by South African adults was 6,3% in 2009, significantly lower than the 19,3% recorded in 2003 and also down on 7,1% in 2005.

The decline in the numbers of visitors to casinos no doubt makes operators keener than ever to introduce new gambling options, particularly online. But, given current uncertainty, they continue to devote resources to their land-based operations.

Casino operator Peermont, which has nine operations in SA and five in Botswana, has invested R410m in its properties in the past two years. It includes upgrading the Emporium at Emperors Palace in Gauteng.

“We conducted extensive market research, which showed that casino complexes are increasingly perceived by South Africans as safe entertainment destinations,” says Peermont CEO Anthony Puttergill.

“We saw that many of the attractions at Emperors Palace were dated and not necessarily the kind of entertainment the market was looking for.”

So out went the old-style rollercoaster, video and games arcades and in came a revamped centre catering extensively for families. In addition to an overhauled games arcade, a new betting facility and a total of eight restaurants, either new or restored, the Emporium features six movie theatres.

In addition, Peermont’s new 70-room Metcourt hotel at Rio in Klerksdorp opened its doors in March and the Peermont Walmont Hotel at Mmabatho Palms in Mafikeng was refurbished.

Puttergill says the group will expand the Tusk Umfolozi resort at Empangeni in January next year to include a new hotel, restaurant, conference centre and multipurpose entertainment facilities.

Meanwhile, Sun International opened the Monticello Casino south of Chile’s capital, Santiago, in October last year as part of the first phase of the new resort. Last month, it opened the retail and entertainment components for business and the resort’s 155 room hotel will open in December.

The group reported recently that a strong revenue stream from the new casino in Chile had saved the hotel and gaming group from what would have been a poor quarter to the end of September.

Sun International’s overall gaming revenue was up 6% to R1536bn due largely to Monticello’s performance. Take the new Chilean casino out of the equation and gaming revenue was 5% below last year. Revenue at Grand West, its flagship casino, was down 7%, Carnival City down 15% and Boardwalk slipped 6%.

Most local casinos and gambling outlets have seen revenue slip this year and, while some report that visitor numbers have been constant, amounts gambled have slumped with the state of the economy clearly having an effect.

“In fact, it has been a good time to refurbish our sites,” says Puttergill.

“Of course, we did not know it when we began work, but I guess it is better to disrupt business when things are not great than when customers are flocking to the resorts.

“What’s more, at Emperors Palace it means we will be ready to welcome users of the Gautrain — we are the only casino on the train’s route.”

Source: Business Day